tv Your World With Neil Cavuto FOX News July 16, 2009 4:00pm-5:00pm EDT
it is time for your world boom. i will see better tonight. [captioning made possible by fox news channel] captioned by the national captioning institute --www.ncicap.org-- neil: if we can squeeze savings to pay for health care, why the tax hikes? >> we need a revenue stream to ensure that the bill had been paid for. we can use extra money to reduce the deficit. neil: a description of who is really getting squeezed. welcome, everybody. the speaker says we do not need taxes to pay for health care, but we will tax people. what about a lock box? we are with it with john mccain
and steny hoyer. we begin with the former presidential candidate himself, senator john mccain. good to have you. what do you make of that? >> i know it is a liberal philosophy, but are not think the american people ought to be told -- that we will raise their taxes. the most important event today was the head of the cbo made a strong statement that will affect the debate. he said legislation does not have the sort of fundamental changes necessary to reduce the trajectory of federal health spending by significant amount, and he goes on to say that on the contrary, legislation significantly aspirant's -- expands the federal responsibility for health costs. that is the objective assessment by the congressional budget office.
it contradicts all the things that democrats have been saying. there are no cost-saving measures in at the bill. neil: he recently sent some of the our costs are about one-and- a-half. >> it also leaves 33 million uninsured. neil: where will this lead us? where does this stand? >> i am not sure, because they have 60 votes here in the senate, i would guess. certainly depending on the health of the couple of members. they have a majority in the house of representatives, so i do not know. the president has reiterated his commitment and this is like a fish in the sun.
if you leave it out there long enough, it will smelled badly to the american people. that is why they are in such a rush to fundamentally affect one sixth of our gross national product. neil: nancy pelosi indicated that you might be able with to compensate to the tax hikes to pay for this. it channeling the money to the deficit -- that is not how this started. someone has changed the lock box and taken the key. we have taken this before, haven't we? >> you cannot make it up. we always have a 1.1 trillion dollar deficit. we will have one that is the largest in history staring us in the face and this is well over a trillion dollars. some say it is as high as two or three.
there was a measure called something like the community, i do not have the exact name, which characterized national health infrastructure. playgrounds, bike paths, etc. some say it is an exaggeration, but senator kennedy cost spokesperson said these are not public grants, they are community transformation grabs. we should not prohibit this from happening. it will be a huge earmarked, pork barrel program. neil: they are in the majority, and probably able to get their
way. right now we have the president in new jersey with john corzine, who is in a heap of political trouble, very much down to the wire, and it will be the first big post-presidential test. and ask you, he is trying to sell a health care reform package. many fit into the upper income zone. how let us go down? >> the impact on small business is horrendous. small business, the generator of jobs in america.
well we lost sight of is that the best health care is in the u.s. the problem is the affordable -- affordability. that is a contradiction. neil: they say the contradiction is that you do not always jump ugly on the president. they should look at this because it looks wasteful. explain. >> for the f-22 -- we have 187 of them. we need the joint strike pattern. they took money for the joint strike fighter which is badly needed. the f-22 has reached the end of its requirements in the view of
the secretary of defense, a man i admire enormously. put the money into the strike fighter so we have a weapons system that will meet challenges of the 21st century. this is about jobs. it will hurt jobs, but we should not use weapons systems as job creation. we should use it to defend the nation. that is what this is about. neil: have you talked with sarah palin? >> i wish her well. i knew she was going to continue to pay a major role in american political scenes and the political parties, i am grateful and proud of her and the fact is that people can say otherwise -- she ignited our party. i'm so proud of the job she did and have never seen personal
attacks made on any one's family. neil: judge to run in 2012? >> if she wants to, she should run. it is early in the scenario. but the fact is that i know she will make an enormous contribution to the country in the future. neil: thank you very much. meanwhile, the stocks go out, and i see it enormously close to lehman brothers not being rescued. you would think the market would not be happy, but think again, because the dow was up again today, 95 points. it surged more than 500 this week. my next guest says the markets are finally cyclical.
he is the editor of real most is clearmarkets.com. -- realclearmarkets.com. >> and they said that markets would cheer the bailout, and once it came in that once they come without strings attached, they would sell off. this is very positive. neil: i am wondering if they create their own problems and said, "if you do not like us, there will be held to pay a." -- help to pay -- hell to pay." >> is little of that. it is also politically difficult to bail out another finance firm. it has not worked, and it has been a major disaster. look at that bailout fund. it will send more good money after bad, particularly in a bad economic. with a lasting you want to do
is find the concept. you want limited capital to go to good business concepts. it is not economically or politically smart. neil: had we done this last fall in practice tough love and said it did not happen, the buck stops here, you have to find another way to get a buck, would we be in the ensuing financial pickle we got in? what do you think? >> i do not think even close. the dream would have been when bear stearns went into trouble, it would have been allowed to die. this would have told other banks that you have to find a buyer or find capital quickly, or you will go down, too. neil: but it was said and reiterated today that that was not really the option. they were all imploding simultaneously. what did you make of that? this time is very different than back then. >> i do not see the difference.
if private investors are not willing to prop up the company, that they think it it is unworthy, it is hard for taxpayers, what that means is you're taking good capital and funneling it into a company that should be allowed to die. the point of capitalism is that there is failure and success. businesses do not disappear. they get acquired. the idea that bank failure could set our economy back -- neil: always good seeing you, john. thank you very much. not republicans, but democrats. steny hoyer is next. an obama facing his first task -- fighting to take control of new jersey economically.
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the campaign last year. the issue they have is a specific in terms of ways of doing that, and they are discussing that. they will have the votes for some changes in the bill. i am not sure. the bills could be marked up over the next four days or five days and we will see, but certain and that the blue dogs want to vote for health. they need to make sure that everyone in america has access to affordable health care. neil: right, but not all of them would hear the speaker said that tax hikes meant for health care might be repurchased in the deficit reduction. i am sure that confused them. >> i did not hear the speaker say that. but the bottom line is that we will have to bring costs down. that must be the objective of this bill. cost for the government, individuals, families, and
business. we will have to bring costs down because our present costs are unsustainable over the long run. that will be our top objective. >> we have to have a revenue stream. if we do not like that money, we can use it to reduce the deficit. neil: if that money was to pay for health care and it turns out you have a lot of savings, more than you realize, and you do not need it, why not just give that tax hike money back to the people you were hiking in on, rather than the purpose it for something. -- repercussive? >> we have this challenge in front of us, which has been added to in the past few months
trying to meet the economic crisis. after the request from the first bush administration and the obama administration, i am sure what the speaker was saying is, "look, with the revenue is projected to pay for this in the short term, the inclusion of all americans in health care raises more money than is projected and there is money available, rather than put out to other spending. we should reduce the deficit." we have to reduce the deficit, for this generation and generations to come. i support her in that effort. neil: i know you're saying that, but if you are really rich, and all of the sudden you were told that the 5.4% surtax you would have slapped on you to pay for health care was going to be for health care and you knew your top rate would go up, ostensibly to even things out from the bush
years -- all of the sudden, 5.4% of the height is for another reason. >> i do not know what the context is. she was saying with more money in the treasury, we will apply that to deficit reduction, which would be appropriate. if in fact we conclude that the rate was there, we ought to modify that percentage. we would have to look clearly at the context in which it was said and what again with the estimate of what cost and revenues would be. neil: are you losing control of this? do you feel it is slipping away? >> no.
i do not. every member of the democratic caucus believes we need to have health care reform. john mccain campaigned on the basis we needed health care reform. neil: we just had him on, and he is not a happy camper. and this is the polar opposite of what he wanted. >> john mccain does not agree with the means to achieve the objective. when he was running for president, he campaigned on it. we needed health care reform. he had a different proposal and i am sympathetic to one funding proposal that he had, which means i am in the minority with him on the issue. having said that, what i'm saying now -- neil: you're talking about funding proposals to tax health benefits? >> yes. i think the senate has concluded the issue never was viable.
president obama during the campaign said he thought it was not a good idea. i happen to think that it is good tax policy, but i do not think it will move forward. so it probably is dead. but the point is, mccain thought we needed health reform. we are arguing about the ways and means to affect health care reform, but not about the necessity of doing so. neil: but do you really believe -- and i say this to democrats and republicans, it will present these huge savings over the year to more than justify the up- front costs? i have not seen that yet in history and and wondering what principle you are looking into. >> let's take medicare. it is a cost to the government, but medicare and social scared together literally have taken --
i cannot give you the exact in millions, but millions of seniors out of poverty which means that they were not on the poverty program, but were in fact sustaining themselves, the kids were not put to the responsibility of supporting and could invest in it. i think that there has clearly been a net positive for those programs. they have been costly and we need to look at them and make sure they are sustainable in the long run, but certainly the last 30 years for medicare and some 60 years, seven years for social security, there have been programs which have a net positive fiscal impact on this country. am i sure on health care? i am not absolutely positive. i think we need to be positive and make sure that is the case.
neil: if this package goes through, i think we are going to have a figure of 39 a tax rates if you include the surtax. that is a lot of states with a lot of taxes. >> we're talking about people making over a million dollars. we're talking about very high income. they are going to be paying more taxes. neil: are you worried they might
just have fewer rich people? >> i do not go to town meetings and have people raise their hands and say that they're worried about rich people. there were about your middle- class working people who can make it in this country. that is not to say that we ought to -- >> your colleague in the senate is wondering about rich folks and their ability. you always go and say they are fine, whatever. but he is worried that if you keep going to that, you will run out of water. >> that is an accurate statement, in fact. that is why we want to keep rates as low as we can, but frankly, what we have been doing of the last eight years, you and i have had this conversation before -- i think that we have been spending more and paying less. that is not a viable way for us to go forward, and as you know, i think it is immoral fiscally
for the next generation. my children, grandchildren, and my one great granddaughter. we have a tremendous spread between the richest americans and to others. that is not a healthy way for us to go. i am not sure i agree with ben that i am worried about the rich. i am worried about the shrinking middle class and the fact that they do not have the available things that they can afford to maintain quality of their family lives.
if you get a 50% tax rate combined, that is cause for concern. rates are lower, generally speaking. neil: do you think hiking taxes on the rich kids and squealing, try hiking them on the not so rich? gov. ed rendell of pennsylvania says that the state budget is a mess. he joins me right now. good to have you. >> good afternoon. >> you have got a 16% tax hike that you want to push through in pennsylvania and i guess it would include everyone except those earning 32,000 or below,
is that right? >> no. 46% of households would not have a hike. that is low wage earners whose families earn less than 32,000, a senior citizens, one of the few states for no retirement income, and our unemployed population, it just a little above half a million. neil: what is the figure for couples? >> it is based on household income, so they would have to make less than 32,000. neil: more than half your residents are in that camp? >> people who earn less than $32,000 and the unemployed. interestingly, you used the term 16%, and that is accurate, but we have the second lowest rate in the nation. many states love to pay -- the
increase goes to 3.57. that increase for the medium income wage earner in pennsylvania is less than $4.50 a week. it will expire in three years. neil: 3 years and we're done. i love you dearly, but we just hope -- we heard from speaker pelosi, and we hope that the surtax would just before health care. lo and behold we discover that if you raise savings in health care, we are going to keep the money from the rich and use it for deficit reduction. somebody took the key to that lock box and i am just wondering if someone will keep the key to a three-year deal, you know? >> i want to go back historically. you remember gov. dick thornburgh and bob casey. in the face of national
recessions of 1983 and 1991, both of them raised the income tax and said they would roll it back. those rollbacks occurred to the percentage they said it would in the year they said the rollbacks would occur. so i think pennsylvania is on a different track record. neil: will you still be governor? what is the deal? >> no. i go out on january, 2011. i will propose -- neil: be will come back, regardless, if someone lies to us here. >> i will hand the next governor a proposed budget. for five weeks to go. it is a sunset provision, and that means it goes out of law automatically. neil: everyone says, why did you cut spending? but, you know, your party has a
knee-jerk disposition to hike taxes and dance -- ask questions later. not that republicans are stewards of fiscal responsibility, but this is out of control. we have deficits that are out of control and now we have a very popular governor in a key state, adding to the tax burden. >> keep everything in context. in six years, business in pennsylvania has received almost $2 billion in tax cuts. i'm the first governor in the history of pennsylvania -- every governor promised to lower property taxes. we lower them so effectively that 120,000 senior households have seen school property tax eliminated, another 300,000 saw them cut in half. neil: i heard you mention that you helped more than you heard. but in washington, what they are trying to do is say, you know,
we might have to revisit stimulus. a lot of counterparts are saying that we need more money in stimulus. do you? >> i would say that is infinitely too premature. right now we have to wait and see how this stimulus works. in pennsylvania, our infrastructure programs are just clearing up. we have 7% of project working, but it is just beginning in the last weeks. by labor day we will have worked on 85% of projects. let's see the impact that has before we decide on a second stimulus. but there should only be one thing included. hard infrastructure projects. we know those produced jobs and orders for factories. neil: thank you very much. meanwhile, the president is stumping in new jersey for another governor, john corzine. it seems like everyone is there.
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about tomorrow. ibm beating the street handily. big blue also increasing its full profit outlook, which is important, because when they start talking about how things are looking, it can be very interesting. they're saying similar things, that future looks good. we're out of the woods. the president is about to hold a big rally, and in fact he is in the middle of it now. john corzine, behind him, is in the fight of his life, facing a tough reelection bid. the new polls show him trailing his challenger. chris christie is 63 to 41%, but with more taxes, is this really the first big help for the president? we have the "washington examiner."
will become a resident? >> i do not know of that will help. corzine is a lot of trouble. another poll is out in addition to the one just cited taken out today, independent losing two- one, losing democratic votes, and doing poorly among african- american voters in the state. that is part of the appeal of having obama around. even though he is an extremely popular, he is saying that in least when they're cold, they will not sway. 60% since it makes no difference, 17 says it makes them less likely to support him, and about 13% say it's less likely. a slight negative. neil: republicans have a history of getting defeat from the jaws
of victory, and i'm wondering if the same thing will happen now. >> that is true. anytime you say something positive, someone will be able to come back later and say you are wrong. in this case, though, it has never been quite so bad for a democrat. we have a fiasco in 2002, the close race for corzine was first elected in 2000. if there have been a lot, but corzine is so deeply unpopular that his on popularity numbers are far outstripping his popularity at this time. neil: nationally, republicans will try to attach this to obama, saying that he is losing momentum. your polls have shown a dip in popularity. so that going on would be case. >> that is part of what obama wants to avoid, the story november about how democrats lost in virginia and new jersey. regardless of how meaningful that actually is, it sends a signal, and obama going out and
stumping for corzine, even if it is a lost cause, sends a signal to a lot of other democrats who are going to be on the ballot next year when he is not, saying, look, i will be there for you. he is trying to push an ambitious agenda in washington now and a lot of democrats are afraid of that and what it means for their reelection chances. obama is saying, "hey, look, i'm going to be there with you." he will be in democrats facing the election. neil: into very, very much. 17,000 votes at the rally, but not jersey resident johnny from the "sopranos." and he is their next. and a showdown on health care. you just heard from steny hoyer about blue dog democrats threatening the bills.
a lot of folks are at the rally right now. not this guy, but years from jersey. he says that both of them are bad for new jersey, that they are to double peace in the same tax hiking, and he is sick of it. you might know him as a johnny from "the sopranos." you are not there. why not? >> you have people out of work in people who took the guy off. neil: the governor is in a heap of trouble, isn't he?
>> let me tell you something. you're talking about budget gaps. this may sound crude, but take the kid who grosses $1,000 a day at in any major city in new jersey. where is his tax filing every month? where is his 941 every quarter? if you want to close the gap, beat everybody alone and go after the people the likes of which cannot be contained on one plan that out. why don't you work for a landscaper and goes to a place where money is of the country. take 20% for the government, be mandated to report it and send it in. you talk about closing the deficit -- there is a lot of money out there.
neil: they talk about ways to go after the economy but never do. >> it is silly. neil: you could knock on somebody's door. >> i could do that. but what i want to say to you is that it is monde mindboggling, and i have this question in my mind. new jersey for all of america. what happens if people could do well in this country through their own efforts? how about everyone making over $200,000 a year? who will want to pick that every month for a check? they will have to grow their own vegetables, milk their own cow, and find a way. horatio alger? it is about you. it is about personal things.
freedom is getting taken over by control that starts in washington. neil: you said that this is where we're headed, and we have our government and a big health care package. a lot of folks are going to be taken care of. what do you think about that? >> i do not know what i think about that. i do not think it is a privilege to be taking care of when you are sick. is it right. -- it is our right. i think it should allow more crop -- doctors to get licenses. what are these things where we can only take nine students in medical school? why can we have more doctors in this country? maybe it will make less. tort reform has to be something to be spoken about before talking about health care. if you lose a pension? $400 million. come on. things cost so much in america because everyone is afraid of
lawyers. do you know what? i am ready. neil: 90 very much. nancy pelosi is saying she is over cutting tax hikes that would pay for health care in a move to get blue dog democrats to sign on. would it help ? pasteurized processed cheese product? (lou gentine) or natural cheese slices? at sargento, our deli style slices are always made naturally. sargento. persnickety people. exceptional cheese. (announcer) introducing new tums dual action. this tums goes to work in seconds and lasts for hours.
congressman, what you think of that? >> is a step in the right direction. this bill does not strike a balance between preserving what works and our current system and fixing what does not work. we need to make reforms in our payment system. we need to do quality investment, not quantity. currently it is based on how many services you provide and how often you show up in the doctor's office. we need to squeeze the inefficiencies out of this. neil: a deficit reduction leaves aside the fact that it is there. it least it is getting the deficit thing addressed. >> i would be on board with fixing the health care system.
neil: stony hoyer was ok with the idea. are you? are you willing to deal with it, knowing there's a potential for them to be used for other means? >> i certainly do not want tax hikes to pay for other programs. neil: but for deficit relief would be ok? >> no. not tax hikes. i think we need to do budget scoring and pay for everything. blindly say we will increase taxes for some relief on the deficit that is undefined, no. i am not good with that.
neil: the way that health care stands right now, for or against? >> i cannot support the bill as currently written. tax increases will put a burden on small businesses that cannot afford to offer health care right now. what makes anything think that by increasing their tax burden they will find a way to offer health care to people? neil: how many blue dogs are there? 60? >> there are 52 blue dogs, and each will have to make -- neil: so it is fair to say a majority feel like you do? >> i would say that that is fair, yes. neil: so this thing is not happening. >> they will not be able to pass this bill if they lose 39 house votes. there are 52 blue dogs.
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but with liberty mutual, insurance issues won't, because we offer unlimited rental coverage, new car replacement, and accident forgiveness to help ease your mind. and that's our policy. liberty mutual insurance. neil: all right. well, finally, i have had my differences before with henry paulson and a couple of frosty interviews if memory serves me right, to doot. i didn't fully appreciate the crisis he was almost singlehandedly dealing with last fall but for congress to play high and mighty and trump their indig at this indignity ti into strong-arming america into that
merrill lynch acquisition is beyond everything. say what you want, the guy was working his ass off last fall. i don't remember congress doing much more than yapping last fall. he was working every weekend, by the way, so was i, sending briefs to congress every day, cobbling together rescues that he thought were paramount. again, we can argue that. no arguing this, he weents flying in the dark and wasn't leaving anyone in the dark. he briefed. they bellowed but for them to bellow that he never briefed, well, let me be brief -- shut up! congress knew what was at stake and was clearly briefed on what was at stake. they signed on to rescues that themselves needed rescuing but they signed on to them. back then, i alienated mr. paulson and much of the bush financial team when every day i was ripping these rescues and the dangerous precedent that they were setting, but i was clear and i hope i'm clear now, mr. paulson wasn't ramming anything down anyone's throat
without anyone else knowing, without his very questioners feigning ignorance today. they all knew. they knew his temperament, his do it or screw it approach, everything, so for them to say otherwise is a lie. it is a lie and they are liars. criticize hank paulson on anything you want. being brutally frank and honest was the stooges' dare second-guessing him back then shouldn't be one of them. he deserves better because watching this kangaroo court today, well they proved the very worst. that guy is no fan of me, believe me, but right is right and wrong is wrong and he was right to be angry about them being wrong. whatever. no whatever about this. take a look at this. 95 1/2 additional points, 500-plus points on the week. we didn't rescue a